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Your Housing Group Limited (202302414)

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REPORT

COMPLAINT 202302414

Your Housing Group Limited

4 March 2025


Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration’, for example whether the landlord has failed to keep to the law, followed proper procedure, followed good practice or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

  1. The complaint is about the landlord’s handling of the resident’s enquiries about an increase in utility charges and the administration of the Energy Bill Relief Scheme (EBRS) and the Energy Bill Discount Scheme (EBDS).

Background

  1. The resident has occupied the property, a one bedroom flat on the second floor, on an assured non-shorthold tenancy since 2017. He has a number of health issues and lives in an extra care scheme comprising 82 homes. He is the Chair of the Residents Association and another resident from the building has brought the complaint on his behalf, as his representative (the representative).
  2. Water, heating and lighting are provided from communal supplies. The costs are split between 40% communal and 60% personal charges then divided equally amongst the number of homes at the scheme. Communal charges are included as part of residents’ Service Charge and personal charges are included as part of residents’ Amenity Charge.
  3. Due to an increase in fuel costs nationally, by September 2022 the landlord re-procured its group wide utility contracts and saw increases of around 350%. From September 2022 to March 2023, the landlord did not pass on the increase to customers with communal supplies, but it notified the residents that it could not continue to do this, so there would be an increase to their service and amenity charges from April 2023.
  4. As the charges would be increasing a lot, the landlord arranged to attend a meeting with residents on 9 March 2023 to deliver a presentation about the changes and offer advice and support on how to apply for further relief and ensure that residents were claiming their maximum benefit entitlement.
  5. Following this meeting, a complaint was logged by the landlord, having received a petition dated 14 March 2023 from the resident and others in the building about this issue. The resident said the petition was sent in protest to the level of increase in its charges. He said the annual increase in energy bills for the average household should be approximately £1,570 a year. However, the increase being introduced by the landlord meant an annual increase of £3,001.96 for tenants and £3,889.60 for leaseholders and this was unreasonable. The landlord was also contacted by the resident’s MP asking it to address the issue.
  6. In the landlord’s stage 1 response of 30 March 2023, it said:
    1. It was a commercial utility supplier and its costs were not subject to the Government’s Energy Price Cap or Energy Price Guarantee which is why the costs for utilities at some schemes may have exceeded this.
    2. It had incurred increased energy costs since September 2022 but had not passed those on. It could not continue that way, so it changed its energy supplier in September 2022 and the additional costs had to be passed on via service and amenity charges.
    3. It had provided details of how residents could get help and support with paying for their energy bills and it would review the bills after the first quarter to see if it could reduce the charges. In particular, the Government released details of the Energy Bill Support Scheme (EBSS) for individual customers which people could claim. It encouraged all residents to apply and said the Scheme Manager would contact all residents to ensure any resident who had not yet applied was helped.
    4. It acknowledged the residents had asked for someone from the Charge team to attend the meeting that had taken place, but it had no one available.
  7. On 4 April 2023, the representative told the landlord and the MP that the complaint remained unresolved. The landlord acknowledged that the complaint had been escalated on 21 April 2023 and the resident was advised to expect a further response by 23 May 2023.
  8. The landlord spoke with the resident on 17 May 2023 and noted he wanted a member of staff to attend a meeting with residents to explain why there was such an increase in the service charge. It explained that as a commercial supplier it operated differently to a domestic user but would provide a written complaint response.
  9. In the landlord’s stage 2 response of 25 May 2023 it said:
    1. A member of the Service Charge Team would meet with residents at a meeting on 19 June 2023 to explain the reason for the utility increases in detail and answer specific queries.
    2. It reiterated it was a commercial utility supplier as it supplied energy to customers and charged them for the service, which was paid for via the service charge and amenity charge.
    3. The EBRS was introduced in September 2022, which was intended to provide relief for non-domestic customers with discounts being applied to energy usage between 1st October 2022 and 31st March 2023. This discount was applied automatically to the bills it received during this time period and the amount received up to 31 March 2023 would be shown in the annual service charge accounts provided for the 2022/2023 financial year.
    4. The Government scheme which replaced the EBRS was called the EBDS and applied from April 2023 to April 2024. It was in the process of applying for this relief as it related to the gas supply as this powered the heating and hot water through a heat network. When it received confirmation it would receive EBDS, it would revise the service charge and amenity charge and advise customers of any changes.
    5. The Government also introduced the EBSS in January 2023, which enabled customers who receive heating and hot water through a heat network to apply for £400 to be paid directly to the customer to provide help with energy bills for winter 2002/2023. It promoted this scheme to all residents and onsite colleagues assisted any residents who needed support to apply for this.
  10. On 3 October 2023 the representative told the landlord that, if the EBRS discount had been included in their service charge statement dated April 2023, then the weekly service charge would have been £84.68 per week instead of £123.20. She said ordinary householders received their discounts immediately but they had to wait until 2024 for the EBRS and hence 2025 for the EBDS discount and this was “grossly unfair and totally unacceptable.”
  11. The landlord’s response of 6 October 2023 said:
    1. The payments it received had to be applied to the correct accounting periods. It had to follow the guidance and legislation which governed the scheme.
    2. As shown in the service charge accounts an overall small surplus was calculated for the service charge at the end of the financial year due to underspends in other service charge costs. However there would have been a significant deficit should the EBRS discount not have been received impacting the next service charge set from April 2024.
    3. To provide continued assistance, the Government introduced the EBDS from 1 April 2023 and it had applied for the enhanced discount for the gas supply because this supplied homes through the communal heating system. It was waiting for confirmation that the supply was eligible for the discount and it had committed to revising the service and amenity charge at the earliest opportunity so that residents received the benefit of the discount when costs were at their highest.
  12. On 7 January 2025 the landlord wrote to all residents to explain it had entered in to a new utilities contract which it hoped would result in lower energy costs, and it would share details of the new charges by the upcoming annual rent information being sent in March 2025.

Assessment and findings

Scope of investigation

  1. The representative has explained she has significant concerns about the escalating service charges that all residents are being asked to pay. We will not consider matters which concern the level of rent or service charge or the amount of a rent or service charge increase. This is because it is not for us to determine whether the service charge due from each resident for the services provided is payable or reasonable. That would be for the First Tier Tribunal to determine. This investigation is therefore focused only on how the landlord addressed the resident’s concerns about the increase in utility charges and the financial relief schemes.

Enquiries about increase in utility charges and administration of EBRS and EBDS.

  1. There has been a significant increase in energy costs in the UK in recent years and EBRS and EBDS were schemes that provided financial relief for non-domestic utility customers. The representative has said the landlord lied about its knowledge of EBRS and EBDS at a meeting it had with residents. Although it is not known what was said at the initial meeting on 9 March 2023, it is evident (having reviewed a copy of the presentation the landlord gave) that it informed the residents that the service and amenity charges were increasing due to rising utility costs.
  2. When the landlord responded to the petition/complaint, it explained it was a commercial supplier and what the EBRS and EBDS schemes were at that point and how they would be applied to those residing in the building. Therefore, irrespective of what had been said before, the residents were fully informed by that time. In addition to ensuring these schemes were applied for, the landlord also offered support to those that needed to apply for additional financial assistance in paying their utility bills. It also met with residents again as requested, to discuss their queries and concerns. These were both appropriate steps to take to ensure the residents were fully informed of the changes and that vulnerable residents’ needs were met.
  3. The representative has said it was “grossly unfair and totally unacceptable” to have to wait for the landlord to apply the EBRS and EBDS payments to the service charge and amenity charge accounts, because ordinary households received payments from the Government paid directly. However, these schemes work differently to the scheme used for domestic users, as they stipulate that the Government compensates the landlord as supplier. It would then be for the landlord to attribute that accordingly by applying it to the service charge and amenity charge accounts.
  4. The landlord has evidenced that the EBRS discount was applied to the service charge and amenity charge account for 2022/2023 and the EBDS discount applied to the service charge and amenity charge in 2023/2024. It then wrote to the resident on 30 September 2024 and explained that, as a result of receiving that payment, it would be issuing a credit to the amenity charge. The representative has said she also received that letter and has indicated she may personally challenge the payment due. That is of course her right, but does not form part of the complaint considered here.
  5. In summary, the landlord entered in to a new contract with an energy supplier in September 2022 which led to an increase in the service and amenity charges. The Occupancy Agreement makes it clear that the resident has to pay both a service charge and amenity charge. The service charges are variable and while the resident’s representative is unhappy a broker was used to find a supplier, and with the amount charged, there was no obligation on the landlord to liaise with residents over which supplier to use. 
  6. The landlord cannot be held responsible for utility costs increasing. However, since September 2022, it has taken a number of steps to help the resident(s) in terms of costs:
    1. Initially it did not pass on the additional costs to residents for 6 months.
    2. It met with residents to explain that energy prices had gone up and the impact on the service and amenity charges and offered any support needed in claiming benefits.
    3. It explained the EBRS and EBDS schemes and has accounted for the payments received in its accounts and arranged for credits to be made to residents.
    4. It noted all the residents’ concerns over how much the utility costs were and said it would continually review whether any better rates were available. The latest correspondence shows it adhered to that promise, as it did change supplier again when it found a better deal.
  7. Overall, the landlord has dealt with all enquiries and concerns by liaising with residents throughout, answering their enquiries and accounting for the EBRS and EBDS payments received. Therefore, it acted reasonably.

Determination

  1. In accordance with paragraph 52 of the Scheme, there was no maladministration in relation to the landlord’s handling of and response to the residents’ enquiries about the increase in utility charges and the administration of EBRS and the EBDS.